The struggling construction and housing sector will soon find it tougher to raise funds overseas as the government plans to tighten foreign direct investment rules to discourage short-term profiteering. At 12:30 pm, Unitech was trading down 4.04% at Rs 34.45, Jaiprakash Associates down 2.43% at Rs 74.30, IVRCL Infrastructure & Projects down 2.19% at Rs 62.60, DB Realty down 5.45% at Rs 119.70. The finance ministry and the Department of Industrial Policy and Promotion (DIPP) have proposed an increase in the minimum capital requirement along with stiffer exit norms for foreign firms investing in the sector.

“The idea is to explicitly lay down the object of the FDI policy,” a government official privy to the discussions told ET. The new set of rules will be incorporated in the FDI circular due to be issued in March. It will require a firm to fulfill the minimum capitalization norm for each project and not just at the company level as is the rule now. At present, a company operating in the sector is required to have a minimum capital of $10 million if it is 100% foreign owned and $5 million if it is in a joint venture. This change will essentially push up the capital requirement for the sector as most companies have more than one project and make it difficult for the firms to raise funds, an executive with a real estate firm said.

Source : http://www.indianrealtynews.com

Abu Dhabi is set to host a new India property show that will bring over 100 projects from across India for the Capital-based Non-Resident Indians (NRIs), according to its organiser — Future Exhibitions and Promotions (FEP). The inaugural ‘India Property 2011’ is scheduled to be held from February 11-12, 2011 in Abu Dhabi that will showcase affordable and hi-end luxury properties with competitive prices in the market starting from Rs1 million to Rs10 million. The two-day exhibition will provide a unique opportunity for NRIs to get first-hand information on the current Indian real estate scenario from the people directly involved in the industry on a day-to-day basis, discuss with the builders about their latest projects, facilities, amenities offered, prices and payment plans.

“Dubai already has 4-5 regular Indian property shows, so we decided to select Abu Dhabi for our inaugural event,” Syed Asim, Managing Director, FEP, told Khaleej Times. It would be first India property show in Abu Dhabi after a long time and a very good response is expected from NRIs based in the Capital as they don’t need to travel all the way to Dubai for a property show, Asim said. For people looking to buy a home or invest in the lucrative Indian real-estate sector, the choice of properties on offer ranges from high-end luxury villas to best value properties. Some of the developers at the show include: Unitech, Hiranandani Upscale, Century Real Estate, Natwest Constructions and many more. “In addition to NRIs related with oil and gas companies in Abu Dhabi, we are targeting individuals, buyers of residential properties, real estate developers, builders, contractors and real estate agents, arthitects, interior designers, consultants, government officials and private companies looking for commercial properties and 
corporate houses.

Source : http://www.indianrealtynews.com

India in the post liberalization period has witnessed rapid economic development. This has initiated the growth of the real estate market in the country. The high demand for office spaces has led to the construction of high-end tech parks all across. In fact, for the past 5 years, the commercial real estate has picked up significantly and now has transformed architecture to major extent. Let us take a note of some of the highlights related to commercial real estate sector.

A Note on Commercial Real Estate Sector

• India enjoys a competitive edge in the commercial real estate as it has vast pool of intellectual capital and cost effectiveness. The 496.4 million work force of India indeed serve great potential for real estate investments.

• The real estate investment has indeed good future prospects as the sector has a growth of 30% per annum as well as a 30% average rate of return.

• According to the latest investment, there would be an increase of about $14 billion to $102 billion revenue in the next 10 years. Even though the NRI section has not even tapped 20% of the market, they still find investment in India ensures returns that go more that expected profit.

• Much of the growth of the commercial real estate sector is initiated by the government of India. Due to the relaxation of rules for FDI investments and Tax incentives for NRIs, the inflow of foreign capital has been encouraged to great extent. In fact, in India, the global investors can certainly look out for 25% ROI.

• Another very important reason behind the growth of the commercial sector is the organized retail. The shift in the pattern of luxury goods along with the increase in the purchasing of the consumers have led to the big ventures in the real estate. For example, the RPG Spencer's has huge presence in south India. Others include FoodWorld, MusicWorld and Health and Glow and majors like Birlas, Tatas and Reliance.

• The urban concept of entertainment, fun and leisure has also undergone major transformation. Structures like multiplexes and 5 star hotels are now spotted in all cities of India.

India has turned to be a highly popular destination for investments as its commercial real estate itself yields more than the global real estate.